Economic Machine

Economic Machine Assignment
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Economic Machine Assignment
Economic Machine Assignment             Ray Dalio (2013), in the Youtube video How the Economic Machine Works, explains the mechanics of the economy with the help of graphical demonstrations of how debts, interest rates, borrowing, and lending form a cycle that collectively makes up part of the economy. According to Dalio, the major driving forces of the economy are productivity growth and short-term and long-term debt cycles. The debt cycles, in this case, represent the behavior of the lenders and borrowers. The Federal Reserve, most commonly referred to as the Central Bank in most jurisdictions, help with economic development and the management of recessions by controlling the interest rates accordingly. In worst cases, the Federal Reserve prints adequate money to offset the debt burden...